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US Unemployment Rate Unexpectedly Plunges Below 8% As 661K Jobs Added

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U.S. job gains slowed in September by more than half from the prior month, missing forecasts and suggesting the economic recovery is downshifting as many Americans and businesses struggle without a Covid-19 vaccine or fresh government aid.

Nonfarm payrolls increased by 661,000 following an upwardly revised 1.49 million advance in August, according to data Friday from the Labor Department. That compared with the median estimate of economists for a gain of 859,000. The unemployment rate fell by more than forecast, dropping 0.5 percentage points to 7.9%, though the labor-force participation rate declined by 0.3 points to 61.4%.

The report, the last before November’s presidential election, reflects a sizable decline in government workers, while gains in retail and temporary workers slowed. What’s more, persistently high jobless claims, along with this week’s announcements of tens of thousands of layoffs, also indicate widespread economic pain.

Lawmakers remain at odds over further stimulus to help jobless Americans and small businesses, though the latest numbers could add pressure to agree on a package.

With just a month left before the November election, the jobs data are being closely watched, though the contest was scrambled earlier Friday by news of President Donald Trump’s positive test for the coronavirus. The relatively strong rebound in jobs in prior months has been a talking point for Trump, who before the pandemic presided over the lowest unemployment rate in decades.

U.S. stock futures remained lower following the jobs report, while 10-year Treasuries and the dollar were higher.

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